HomeInsightsAdvocate General Opines that a company alleging defamation can take legal action in the country where it has its centre of interests for all damage claimed

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The claimant, Bolagsupplysningen OU, was an Estonian company, which did most of its business in Sweden. The defendant, Svensk Handel AB (a Swedish trade association), put the company on a blacklist for dealing in “lies and deceit”. It published the blacklist on its website. Over 1000 comments were posted in response. The company issued proceedings against Svensk Handel in Estonia, seeking an order for its removal from the blacklist and removal of comments published on the website. It also sought damages of €56,634.99 for the harm caused to its business.

The matter reached the Estonia Supreme Court, which has asked the CJEU whether the Estonian courts have jurisdiction to hear the case under EU law. More broadly, the Estonian court has invited the CJEU to rule on jurisdictional law relating to reputational harm from online publication.

Advocate General Michal Bobek noted that the general rule is that a defendant should be sued in the defendant’s domicile, which in this case would be Sweden. Bolagsupplysningen OU relied on the exception to that general rule, which enables a claim to be brought in the Member State where the harmful event occurred or may occur.

The CJEU has previously held that, in the case of natural persons, the place where the harmful event occurred or may occur is the State where that person has his or her “centre of interests”. This special jurisdiction rule allows a claimant to sue for the harm suffered in all other EU Member States in a single Member State’s courts.

Bolagsupplysningen OU has asked the Estonian court to apply the special jurisdiction rule based on centre of interests to a legal entity. Bolagsupplysningen OU argues that its centre of interests is in Estonia, even though it does business in Sweden. Its management, economic activity, accounting, business development and personnel departments are located in Estonia and its income is transferred to Estonia from Sweden.

The Advocate General said that there was no good reason why the jurisdictional rules should be applied differently depending on whether the claimant was a natural person or a legal entity.

The Advocate General said that in online defamation claims, the place where the harm occurred was likely to be where the reputation of had been most strongly hit. In defamation cases, this was the true centre of the dispute and was likely to be the place where that person (natural or legal) had his or its centre of interests.

In order to determine the centre of interests of a legal entity, the Advocate General suggested that relevant factors to consider were likely to be the main commercial or other professional activities, which would most accurately be determined by reference to turnover or number of customers or other professional contacts. The Advocate General considered that the seat of the legal entity could be taken into account, but if no professional activities were conducted in that Member State and the company did not produce turnover there, then it could not be the centre of interests. The Advocate General acknowledged that for natural and legal persons there might be more than one centre of interests, but it would be for the claimant to choose the Member State in which to bring an action.

Finally, the Advocate General considered that the relevant jurisdiction would have full competence, adjudicating on the entirety of the alleged harm and the remedies, including, an injunction to correct and remove the contentious information. (Case C-194/16 Bolagsupplysningen OÜ v Svensk Handel AB (Opinion of Advocate General) (13 July 2017) — to access the Opinion in full, go to the curia search form, type in the case number and follow the link).